Apply for a First National Bank Mortgage Loan, reviewed by our experts. As of 10.02.2025, you have access to loan options. Increase your chances of approval by completing an online application and getting a free credit rating check.
Update 04.11.2024
First National Bank (FNB) offers a range of mortgage solutions tailored to meet diverse financial needs, ensuring flexibility for both first-time buyers and property investors. FNB's options include home purchase loans, refinancing, and investment property loans, all with competitive interest rates, whether fixed or variable. Products like the FNB Flexi Option allow borrowers to access additional funds, while joint ownership options like collective buying offer further flexibility. FNB supports clients with pre-approval, personalized rates, and a streamlined digital application process via the FNB App, making the journey to homeownership straightforward and financially viable.
Types of FNB Mortgages
New Home Loan. Tailored for first-time or upgrading buyers, offering competitive fixed or variable rates for up to 20 years. The loan amount depends on credit profile and affordability, up to 100% of property value. Includes features like the Flexi Option for accessing surplus funds.
Building Loan. Financing for land purchase and construction, with phased fund release. Requires NHBRC-registered contractor. Terms up to 20 years, with maximum amount based on land and construction value.
Switch Home Loan. For transferring an existing home loan to FNB, with benefits like competitive rates, reduced fees, and debt consolidation options. Term up to 20 years, based on property value and client profile.
Further Loan. Access additional funds using property equity for personal needs. The maximum amount depends on available equity. Flexible terms up to the original loan term.
Flexi Option. Add-on feature allowing access to extra payments made into the home loan, providing liquidity while reducing interest costs.
Collective Buying. Allows up to 12 individuals to co-own a property. Each co-owner is assessed individually, but all are jointly liable for repayment. Term up to 20 years.
Pension Backed Loan. Uses pension funds as security for a home loan through employer agreements. Suitable for buying, building, or renovating. Term up to retirement age.
Islamic Residential Property Finance. Sharia-compliant mortgage without interest. Involves a co-ownership agreement where the client buys out FNB's share. Term up to 20 years.
Foreign Choice Home Loan. Designed for non-residents or South Africans working abroad to buy property in South Africa. Subject to specific criteria, including exchange control regulations.
Commercial Property Finance. Financing for commercial real estate investments. Terms based on property value and client profile.
Employer-Backed Loan. Available through employer agreements, offering favorable terms with the employer as guarantor.
Structured Loan. Customizable loans for clients with complex financial needs, using multiple forms of collateral.
Securities Based Lending. Uses an investment portfolio as collateral for a home loan, offering flexibility without liquidating assets.
Single Facility®. Combines home loans and transactional accounts into one, providing flexibility in accessing funds and managing repayments.
Key Features
Flexible Repayment Options. FNB offers flexible repayment terms, including options like the Flexi Option, allowing borrowers to make additional payments and access surplus funds when needed.
Competitive Interest Rates. Interest rates are tailored based on the client's risk profile, providing both fixed and variable rate options, and ensuring affordability for diverse financial situations.
Comprehensive Product Range. FNB offers various mortgage solutions, including home loans, building loans, pension-backed loans, and Sharia-compliant finance, catering to different customer needs.
Digital Application Process. Clients can apply, manage, and track their mortgage applications through the FNB App, making the process convenient and transparent.
Joint Ownership Options. Collective Buying allows up to 12 individuals to co-own a property, making it easier for families or friends to invest in real estate together.
Pros and Cons
Pros
Variety of Mortgage Options. FNB offers a range of mortgage types to suit different financial needs, including specialized loans for investors and first-time buyers.
Personalized Service. FNB provides personalized support through its advisory teams, helping clients navigate the mortgage process effectively.
Access to Homeownership Support Programs. FNB participates in programs like government subsidies and employer-backed loans, making homeownership more accessible to qualifying clients.
Cons
Stringent Qualification Criteria. FNB has strict credit and income requirements, which may make it challenging for applicants with lower credit scores to qualify.
Additional Documentation for Certain Loans. Some loan products, such as the Building Loan, require extensive paperwork and approvals, which can prolong the application process.
Variable Costs Based on Risk Profile. Interest rates and costs are influenced by the client's risk profile, which can lead to higher costs for applicants with less favorable credit histories.
How to Get an FNB Mortgage?
Evaluate Your Financial Situation. Start by assessing your income, expenses, and overall credit profile. FNB provides tools like an affordability calculator on their website to help you determine how much you can afford for a home loan.
Choose the Right Mortgage Product. Explore FNB's variety of mortgage solutions, including products like New Home Loans, Building Loans, and Pension-Backed Loans, to determine which one fits your needs.
Consult with an FNB Mortgage Specialist. You can discuss your requirements and get personalized product recommendations by consulting an FNB mortgage specialist. This step is useful for understanding which interest rates and products best suit your situation.
Gather Required Documents. Collect necessary documents such as proof of income, identification, and credit history. For specific loans like a Building Loan, additional paperwork (e.g., building contracts) might be required.
Apply for Pre-Approval. Apply for pre-approval via the FNB App or visit a branch. This helps you know how much you qualify for and strengthens your position when making an offer.
Submit the Full Application. Once pre-approved, complete the full mortgage application through the FNB App or at a branch, providing all required documentation.
Property Valuation. FNB will conduct a property valuation to determine the market value of the property, ensuring it aligns with the loan amount requested.
Approval and Offer. Upon approval, FNB will provide you with a formal mortgage offer detailing the terms, fees, and interest rates. You need to review and accept the offer.
Sign Legal Documents. After accepting the offer, bond attorneys prepare the necessary legal documents for signing. This is typically done at the attorney's office.
Bond Registration. Finally, FNB arranges for the registration of the bond at the Deeds Office, officially transferring ownership and completing the mortgage registration process, which can take several weeks.
Requirements and Conditions
Requirements
Age. The applicant must be at least 18 years old, with a maximum age of 70 at the end of the loan term.
Residency Status. Applicants must be South African citizens, permanent residents, or foreign nationals with approval under specific conditions, including compliance with exchange control regulations.
Proof of Income. Permanently employed individuals must provide the latest three months' payslips and stamped bank statements. Self-employed individuals need six months of personal and business bank statements, proof of income from an accountant, and recent financial statements. A minimum gross income of R25,000 per month is required for individual applicants, or at least one applicant in joint applications.
Identification Documents. A valid South African ID or passport is required. If married, a marriage certificate or antenuptial contract is required. Foreign applicants must provide a valid passport and proof of visa or residency status.
Credit History. Applicants must provide a comprehensive credit report. FNB will perform a credit assessment to determine eligibility and interest rates.
Offer to Purchase. A signed offer to purchase agreement is required as part of the application process.
Building Loan Requirements. For building loans, additional documents such as building contracts, NHBRC certificate, and approved building plans are necessary.
Conditions
Loan Amount Limits. Loans are available up to 100% of the property value for qualifying applicants, subject to creditworthiness and affordability assessment.
Interest Rates. The mortgage interest rate is based on the current prime lending rate of 11.50% per annum. The final rate is personalized and depends on factors such as the applicant's credit rating, property value, and risk profile.
Loan Term. Mortgage terms are available up to 20 years, depending on the applicant's eligibility.
Fees and Costs. Applicants must pay an initiation fee starting from R6,037, monthly service fees of R69, legal costs, bond registration fees, and transfer costs, which vary based on the property value. Deeds Office registry fees range between R70 and R3,000.
Deposit Requirements. For standard home loans, a deposit may be required, depending on the applicant's credit profile. For non-residents applying for a Foreign Choice Home Loan, a 50% deposit of the property value is required, which must originate from foreign funds. For building loans, a minimum deposit of 10% of the total package price (land and construction costs) is required.
Early Settlement Conditions. Clients are allowed to settle their mortgage earlier without incurring penalties, subject to specific conditions.
Ways to Receive the Money
Once approved, FNB disburses mortgage funds directly to the attorneys handling the property transaction or to the construction company for building loans. Funds are not released as cash to the borrower or transferred to a personal account, ensuring they are used only for the intended property or construction expenses.
How to Repay an FNB Mortgage?
Automatic Payments. You can set up automatic monthly debit orders using the FNB App or Online Banking, ensuring timely payments without manual intervention.
Flexible Payment Options. Clients can make additional payments beyond the required monthly repayment.
Lump-Sum Payments. FNB allows you to make lump-sum payments at any time to reduce the total debt.
Things to Pay Attention To
Interest Rate. Verify whether the interest rate is fixed or variable and understand how it is affected by the current prime lending rate of 11.50%. Know that the final rate will depend on your credit score, risk profile, and property value.
Deposit Requirements. Confirm the deposit amount required for your mortgage type. For example, non-residents need a 50% deposit, while building loans require at least a 10% deposit of the total package cost.
Monthly Repayment. Use the FNB home loan calculator to determine your monthly payment amount. Understand how different loan terms affect the monthly installment and the total interest paid over time.
Loan-to-Value Ratio. Check the maximum loan-to-value ratio offered for your mortgage. FNB generally offers up to 100% financing for qualified applicants, but this may vary based on your creditworthiness and financial situation.
Credit History. Ensure your credit history is accurate and up to date, as FNB uses your credit score to determine your eligibility and the applicable interest rate. A higher credit score may qualify you for a better rate.
Fees and Additional Costs. Be aware of all the fees associated with the mortgage, including initiation fees starting from R6,037, monthly service fees of R69, bond registration fees, and legal costs. Use this information to calculate the total cost of your mortgage.
Mortgage Term. Choose a mortgage term that fits your financial situation. FNB offers terms up to 20 years; shorter terms result in higher monthly payments but less total interest paid, while longer terms reduce monthly payments but increase the overall cost.
Editorial Opinion
FNB offers competitive mortgage options with unique features like the Flexi Option for accessing surplus funds and Collective Buying for co-ownership. However, strict eligibility requirements, such as a minimum income of R25,000 and extensive documentation, may be challenging. Borrowers must carefully assess interest rates, fees, and conditions to determine if FNB's terms meet their needs compared to more lenient alternatives.
Can I apply for an FNB home loan if I am self-employed?
Yes, self-employed individuals can apply for an FNB home loan. You will need to provide additional documentation, including six months of personal and business bank statements, proof of income from an accountant, and recent financial statements.
Does FNB offer any special mortgage products for government employees?
Yes, FNB offers a Pension Backed Loan that uses pension funds as security, which is available through agreements with certain employers. This product is ideal for government employees looking for more favorable terms.
What is the minimum loan amount available for an FNB home loan?
The minimum loan amount for an FNB home loan typically starts at R100,000, though this may vary depending on the product type and the applicant's credit profile.
Can I switch my existing home loan from another bank to FNB?
Yes, FNB offers a Switch Home Loan product that allows you to transfer your existing home loan from another bank to FNB. This may provide benefits like lower interest rates or consolidation of other debts.
Are there any penalties for paying off my FNB mortgage early?
No, FNB allows early settlement of mortgages without any penalties, subject to specific conditions. This can help reduce the total interest paid if you choose to repay your loan ahead of schedule.